SC stays insolvency resolution proceedings against Jaypee Infratech

File photoNEW DELHI: The Supreme Court on Monday stayed the insolvency resolution proceedings against Jaypee Infratech on home buyers' plea and asked attorney general KK Venugopal to assist in the matter.

The original board of Jaypee Infratech will now be restored and all consumer cases against the company and its promoters will continue as usual.

The apex court has also issued notices to all the parties including Jaypee Infratech, Jaiprakash Associates, the Reserve Bank of India (RBI), IDBI Bank, ministry of finance and ministry of corporate affairs, informed advocate Ashwarya Sinha, who represented some of the home buyers in the case.

"The Supreme Court has agreed to examine home buyers' plea. It acknowledged that injustice is happening with home buyers and chose to interfere in the case," said Sinha.

A three-member bench headed by chief justice Dipak Misra has asked attorney general KK Venugopal to assist in the matter, Sinha informed. The court has fixed October 10 as the next date of hearing in the case.

Manoj Gaur, managing director, Jaypee Infratech said the company is complying as responsible corporate with its bankers, other stakeholders and homeowners.

"Our resolve to complete and deliver the homes at Wishtown is absolute and we have been and shall continue to endeavour to achieve this goal. We can only comment on the order of Hon' Supreme Court after we read the same. However, it's our duty to implement the same in letter & spirit," he said.

The Allahabad bench of the National Company Law Tribunal (NCLT) on August 9 classified Jaypee Infratech as insolvent on the petition filed by IDBI Bank under Section 7 of Insolvency and Bankruptcy Code 2016.

A group of Jaypee Infratech home buyers, lead by petitioner Chitra Sharma, then moved the Supreme Court against the NCLT order, demanding all court proceedings against the company, including those pending before the consumer courts should continue despite the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016.

Home buyers also urged the apex court to declare home buyers as 'secured creditors' to help them get first right on the company's asset in case of insolvency.

The apex court on August 24 adjourned the hearing, giving time to other home buyers to file their petitions and join the proceedings.

"This is a good news for all of us," said Devendra Yadav, a home buyers in Jaypee's Wish Town project, adding, "The SC decision will surprised most of the senior lawyer who were in the view that nothing will be achieved from this."

Bidhayak Rakshit, a buyer in the Jaypee Aman project, feels there is still no respite from uncertainty.

“While I welcome the move, the stay also means corrupt management of Jaypee is again back in power. We are simply back to the square one. Who will now bell the errant management? State has now a bigger role to play," he said.

Around 32,000 home buyers of Jaypee Infratech had been left in the lurch due to the insolvency proceedings.

ENDS

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